Scientific Games begins tender offer, consent solicitation for $350 million 9¼% notes due 2019

By Toni Weeks

San Luis Obispo, Calif., May 20 - Scientific Games Corp. subsidiary Scientific Games International, Inc. began a cash tender offer to purchase any and all of its $350 million of 9¼% senior subordinated notes due 2019, according to a press release.

The purchase price is $1,051.25 per $1,000 principal amount of notes tendered before the early tender deadline, 5 p.m. ET on June 3. The price includes an early tender amount of $30.00 per $1,000 principal amount.

Holders who tender after the early deadline but before the expiration date, midnight ET on June 17, will not receive the early tender premium.

The company will also pay accrued interest up to but not including the settlement date, which is expected to be June 4 for the early tendered notes.

The company is also soliciting consents to eliminate substantially all of the restrictive covenants and some default provisions in the indenture governing the notes. The proposed amendments require the consent of at least a majority in principal amount of the outstanding notes.

Holders cannot tender their notes without delivering consents and cannot deliver consents without tendering their notes.

Notes tendered before the early deadline may be withdrawn prior to 5 p.m. ET on June 3.

The tender offer is contingent on the satisfaction of some conditions, including the issuance of at least $350 million of notes, the proceeds of which will be used to purchase the notes. The company priced $350 million of 6 5/8% seven-year notes on Tuesday.

Scientific Games announced in a separate press release on Tuesday that it would redeem or repurchase all of the outstanding notes with the proceeds from the new issue of notes. The company also said the proceeds would be used to pay accrued interest plus any related premiums, fees and costs as well as for general corporate purposes.

BofA Merrill Lynch (888 292-0070) is the dealer manager and solicitation agent for the tender offer. Global Bondholder Services Corp. (866 804-2200 or collect 212 430-3774) is the information agent and depositary.

Scientific Games is a New York-based provider of customized, end-to-end gaming services to lottery and gaming organizations.

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